Thursday, September 30, 2004

The Scarcity Theory

Necessity may be the mother of invention, and luck may be the residue of design, but sometimes the best discoveries do happen by accident. I believe that Goodyear discovered vulcanized rubber by letting it cook on a stove too long, and my guess is that Thomas Edison, Ben Franklin and other great inventors got lucky on occasion.

And, depending on how their labor conflagration resolves itself, so might the National Hockey League.

I'm not a mathematician or an economist, but I'll float this theory just the same and hope that people like the Sports Economist and his friends weigh in and offer support or rebuttal.

If you're of a certain generation, you grew up before the cable TV era. Which meant that your or your parents' television had seven channels if you lived in certain major metropolitan areas -- the local affiliates of the three major networks, the local public television affiliate, and three UHF channels, where you turned the channels dial to UHF and then had another dial where you tried to home in on the UHF station (with a number like 35, 52 or 64), adjust the antenna attached to the television, and hope that the second dial didn't slip so that the picture would hold and not turn into a mass of snow, which is what we called a fuzzy, empty screen back then.

During those pre-cable days, sports teams weren't on TV all the time. They didn't televise their home games at all, and they didn't televise their road games all the time. You couldn't get another city's team on cable the way you can now, and the leagues had national contracts to show their games, usually once a week. They truly wanted you to come to the ball park.

Which meant that you listened to the radio a lot. If you grew up in Philadelphia, the radio broadcasters for the teams were household names -- Gene Hart and Don Earle for the Flyers, Bill Campbell for the 76ers, Merrill Reese for the Eagles and Harry Kalas and Richie Ashburn for the Phillies. And, if you liked baseball, you loved Harry and Whitey and learned a lot from them. You had to picture the games in your mind, and you watched games on TV whenever you had the chance because Flyers and Eagles tickets were very hard to get and the team wasn't on TV all that much.

But that was then. Today, it seems like almost every game is on TV. Not only the games of your hometown teams, but also the games of other town's teams, and, if you're a rabid fan, you can purchase a dish or a special cable package and watch all of the [fill in the blank of the sport that you like] you want. Which means, of course, that the rabid fans are in clover, but the less serious fans have a problem. They are oversaturated, and because their sports are available all the time they might appreciate them less. And because they have so much from which to choose, they choose, with the result that the Darwinism of the competition has hurt certain sports.

Tennis. Boxing. Ice hockey.

I've blogged on the other two before, but now it's hockey's turn. There are many reasons why hockey has fallen off in popularity. First, there are too many teams. Talent is diluted, and there are not that many stars. The average team is mediocre and boring. Second, too many teams make the playoffs. Third, the playoff season is about 1/3 as long (in games) as the regular season, and it seems endless. Fourth, playoff hockey is a different brand of hockey -- cleaner, with less fighting. The inconsistency is somewhat trouble. Fifth, the style of play is so defensive that there isn't that much action. Sixth, there are too many games. Yes, hockey fans, there is too much regular-season ice hockey.

Now, you could write a tome as to how to fix hockey, and I'm sure columnists all across North America have attempted to do so. But I just want to address one aspect of my observations -- the part about "too many."

It may well be that there is just too much bad ice hockey out there that the NHL has diminished the attractiveness of its brand. So, how does it right the course? A company that's foundering, with bad divisions that bleed money, restructures. If the sales and margins aren't there and the costs are too high, the company has to do something or face bankruptcy. Well, the NHL is in a similar predicament. It isn't efficient, and it needs to get more efficient to compete against NASCAR and the PGA Tour. There's so much "bad" product out there that people have lost interest, don't tune into games, and don't find that the regular season games have that much meaning because almost everyone makes the playoffs. Because so much "bad" hockey is available, no one really cares. And the ratings prove it.

So what is the NHL to do?

First, it should take a page out of college basketball's book. Because college hoops teams play only say 30 games a year, the product is rather scarce. As a result, every game means something, and only the fittest survive. The NHL, then, should shorten its season. If you play say 60 games, each game matters more and will have more of an impact on who makes the playoffs. People might get more interested if their opportunities to watch were just a little more scarce.

Second, it should reduce the number of teams. There just aren't enough good players to go around, and it was fun way back when you had the goal-a-game line in New York, Mike Bossy and Brian Trottier together on the Islanders, Perrault, Robert and Martin on the Sabres, etc. Today, you don't see concentrations of great players. It's important to say cut the number of teams by about 25%, and concentrate the best players on fewer teams and in the best markets. Again, improve your product, and make it even a little more scarce.

Third, it should reduce the number of teams that make the playoffs. Cut the number down to two per division, period. Then each game means something, every night. Imagine, for example, if the NCAA had an 80-game schedule for DI basketball. The average Duke-Carolina game wouldn't mean much if the ACC Schedule was, say, 48 games. Who would care to watch Duke-West Carolina on Monday and then Duke-East Carolina on Wednesday and then Duke-Marshall on a Saturday night? I doubt the fans would have as much fervor as they do now, where Duke-Clemson on a Tuesday night has a ton of meaning, as does Kentucky-Duke on a Saturday.

Fourth, consider how to make your product a little more scarce. Perhaps you don't have to do a whole lot more if you adopt the three points above. Oh, yes, and there's one more thing, shrink the size of goalies' pads, change the icing rule, get rid of the two-line pass rule and speed up the game. That would make the product more compelling.

Now you might ask, "How will the NHL luck into this?" Well, they won't cut the number of teams, but if the lockout or impasse or whatever noun you want to call it lasts until February, the NHL will have no alternative but to go to a shorter season. They might also have to go to a truncated playoff structure. And, guess what? The individual game will mean more, the playoffs won't seem endless, and the overall viewing will be more compelling. That it became more scarce just might attract more people, with the risk being, of course, that the NHL returns at the wrong time or that some of its loyal fans get so fed up (as baseball fan did in 1994) that they elect not to return. And that is a risk.

In an era when all major sports leagues believe in maximum exposure, not every sports league can get away with it. Sometimes, being scarce, like good diamonds, is a good thing. With fewer teams, fewer bad players, fewer teams making the playoffs, the NHL would create a better product with more compelling drama. Especially compared to the NBA, which suffers from bad fundamentals, too many teams, too long a schedule, too long a playoff system. And, if you create the comparison to the NBA, whose season runs right alongside yours, people just might want to watch your product more.

The NHL is in a crisis right now, but it could, if it acts smartly, turn the crisis into an opportunity. Change, the mathematicians will tell you, is inevitable. The evolutionary biologists will tell you that only the fittest survive. All of us know from "Jurassic Park" that the dinosaurs had their day but couldn't make it, for whatever reason, even if they were so big and powerful (not that the rest of us could survive terrible ice). The NHL right now is this big, unwieldly lummox, surrounded by nimbler, more creative, more compelling sports.

It should take this opportunity to make the right changes and streamline its product into very compelling watching.